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Stock rebound gathers steam

Mumbai, June 25: Stocks marched past a 15-month peak today, reversing the two-day slide in a market that finally clutched at a straw wafting in the air: a comment that HPCL sell-off would be through by November.

A heady Dalal Street sent the Bombay Stock Exchange (BSE) galloping 69.82 points to 3,517.27 points — a height it last scaled on March 21, 2002. “It was a one way street for many shares,” said a FII dealer whose broking outfit was bullish on Indian stocks.

The momentum and scale of the rally took many by surprise on a day when there were twice as many gainers as losers. “We expected shares to consolidate and collect the gains of the past few weeks,” the dealer added.

ASK Raymond James’ Jignesh Shah said the surge was partly the result of covering in the derivatives segment. “We can see some strength after a minor correction.” There could be a pull-back on Thursday, when the current settlement for derivatives comes to a close. “Indices could pause and take a deep breath as they clamber up, but the undertone remains bullish,” he added.

Cement companies were among the day’s best performers with all big players recording gains. Grasim surged Rs 42.60 to Rs 489.75, Gujarat Ambuja went up Rs 3.25 to Rs 192 and L&T increased by Rs 7.25 to Rs 238.50.

The rally in Hindustan Petroleum, the stock that carried the day, was fuelled by reports that its disinvesment would be faster than expected. The stock flared up to a six-year high, gaining Rs 22.65 to close at Rs 351.10. Bharat Petroleum Corporation and Gas Authority of India also finished with handsome numbers.

State Bank of India rode the crest of investor enthusiasm for bank shares, racing to a new nine-year high. Oriental Bank of Commerce, Bank of Baroda, Corporation Bank and Punjab National Bank were among the other PSU banks that recorded sharp increases.

The 30-share index opened on a firm note at 3456.85 against Tuesday’s 3447.45 and raced past the 3500-mark to a high of 3526.86 before settling at 3517.27, a steep rise of 2.03 per cent. Even the broader BSE-100 index shot up 28.24 points to close at a 15-1/2 month high of 1789.44, another indication that the rebound is widening.

Rupee softens

The rupee closed at 46.60 against the dollar, a tad lower from 46.58 on Tuesday. It rallied from an intra-day low of 46.65 after exporters sold greenbacks ahead of the Fed decision on rates.

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